There is no way Primark will ever introduce full-fledged e-commerce, its owner AB Foods stated. Anything more than click&collect would simply leave no margin.
No margin left
Last autumn, Primark (finally, according to many customers) started testing online order collection in 25 British locations, including an ‘online-only’ children’s range. At launch, the public interest was so great that the webshop crashed.
However, Primark did not see this as a sign that e-commerce is the right way and it should move towards home deliveries as well. Only in the peak of the the pandemic did Primark briefly consider “clearing stock to accumulate cash” via platforms such as Zalando or Asos, but as soon as it looked like shops would be allowed to reopen, that idea was quickly shelved.
As its prices are so low and its shopping baskets are so small, e-commerce would take away not just a part but actually all of the margin at the fashion discounter, CEO George Weston of parent holding company AB Foods told the Financial Times. Only pick-up at a retail outlet is an option, as the retailer is counting on people to then buy something extra in the stores straight away – even if it is just a something little like nail polish.
Physical only growth path
Primark also does not believe that Covid has definitively buried offline retail: the chain says it now has a greater market share in many countries than before the pandemic. The fact that sales in some European markets have not yet recovered, on the other hand, Weston attributes to general market conditions.
Instead, growth has to come from good, old-fashioned physical expansion, the fashion discounter believes. For example, Primark is still looking to move into Romania and Slovakia, while also continuing its expansion in the United States. The Irish chain started its US activities in Boston, with its many Irish-American residents, but expanded southwards when the formula caught on with lower income groups and Spanish-speaking Americans.